White Rock Minerals to buy AusStar for $23m

The companies entered a merger implementation deed that will see White Rock take control of the AuStar’s Morning Star and Rose of Denmark mines in the Walhalla-Woods Point gold belt in Victoria.

White Rock Minerals will also retain its name under the merger, with AuStar Gold’s board unanimously recommending its shareholders to vote in favour of the merger.

The company’s merged board will consist of three White Rock Minerals directors and two AuStar directors.

White Rock chairman Peter Lester said it the merger will move the company closer toward becoming a producer.

“White Rock is delighted with the prospect of adding high potential Victorian gold exploration, including a modest production base, in one of Victoria’s most prolific historical gold production regions to its portfolio,” he said.

“With the Morning Star mine and processing plant in place, Austar will also move White Rock closer to being a producer and open up exposure to the growing Victorian exploration and mining scene which has enjoyed a considerable resurgence in recent times.”

The price of the acquisition represents a 47 per cent premium, based on AuStar’s share price on February 1 2021 ($0.295).

AuStar shareholders will receive 0.78 White Rock shares for every AuStar Gold share held.

AuStar gold director Paul McNally has welcomed the deal, and will continue his role in the new company.

“I am extremely pleased to be announcing this transaction, which delivers for AuStar Gold shareholders a certain path forward to accelerated activity on the company’s world-class Victorian gold tenements, as well as the benefit of exposure to White Rock’s high-potential exploration and development assets in Alaska and New South Wales,” he said.